Opinion: Guaranteed pensions for all Americans
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We need to restore the foundation of the middle class, argues Dave Low, chairman of Californians for Retirement Security, a coalition of more than 1.5 million Californians representing public employees and retirees. In a recent Op-Ed about pensions for California workers, Low wrote:
With a new UC Berkeley study showing that half of Californians will retire at or near poverty levels, it is crucial that we work together for retirement security for everyone — in the public and private sector alike.
In response, readers on our discussion board complained to Low about already being taxed out. Here’s Low’s reply to them.
No one has a greater interest in seeing that CalPERS and the state’s other public pension funds are stable and adequately funded than public workers. We are counting on it, in fact, as part of the promise of a secure retirement made to us and our families. We also are taxpayers who want to see California’s private and public finances flourish. And we continue to actively engage in negotiations that already have significantly reduced state and local pension costs.
Understandably, taxpayers are weary after years of budget shortfalls and bitter political battles over their money.
But public servants are the wrong target.
Public employee unions are the ones making concessions and addressing pension abuses, especially those where top managers are receiving $100,000 pensions and padding them with perks that 99% of public employees will never receive. We also support curbs on spiking, including a shift to a three-year average of final compensation that has been put in place for new workers, as well as an end to double dipping.
There is a matter on which we stand on principle: The bargaining table is the fairest and best place for employers and employees to work out wage and benefit issues, including pensions.
Indeed, the generally modest pension benefits of public sector workers look better because private sector pensions have been hacked to death in recent years by the same Wall Street bankers and corporate interests who want to dismantle retirement security for all but the richest Americans.
It is unfortunate that some people would prefer to drag others down, rather than work toward adequate pensions for all American workers. This attitude plays into the hands of the same Wall Street bankers who got us into this fiscal mess. First, they broke the system and created the mortgage crisis, then they got bailed out by taxpayers, now they are back to their old tricks and taking huge, million-dollar bonuses.
According to the Legislative Analyst’s Office, pension costs are among the smallest and slowest growing costs in all of state government. Pensions make up less than 3% of the total budget. Corporate tax loopholes amount to tens of billions from the state budget. Even as the state budget has been cut, new corporate tax loopholes have been passed that will take over $1 billion per year from public education and other programs, and go straight into the coffers of Wall Street corporations.
What sense does it make to take away the pensions of public employees and instead put their retirement in the hands of the same Wall Street bankers, further lining their pockets?
Even the Wall Street Journal, not exactly a staunch supporter of public employees, stated that its own study showed that workers in the private sector will run out of money due to shortfalls in their 401(k) accounts. How is this good for our nation? The middle class was built on the foundation of a good education, a good job and a secure retirement.
Gold-plated public pensions are a myth perpetuated by these same folks -- unless you consider $26,000 a year in California extravagant. Another myth is the supposed brink of disaster for public pension funds. CalPERS’ fund administrators report its funding status had improved to 75% as of June 2011, which rating agencies consider a more than adequate funding level. The fund will continue to have the resources to provide pensions long into the future, thus needed changes to ensure that stability can be made over the long-haul.
The best solution to this problem is to provide guaranteed pensions for all Americans, public or private. Social Security is the most effective anti-poverty program for older Americans in history. Rather than fighting to drag everyone down to the bottom rung of the ladder, we seek to lift all and provide an opportunity for the middle class American dream.
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--Dave Low